ESG Deals & Value

The ESG megatrend has significantly impacted the M&A sector. Globally, sustainability criteria are increasingly influencing deal-making across various industries. Data consistently shows a strong correlation between high ESG performance and enhanced financial and investment returns.

KPMG’s ESG Deals & Value service empowers investors to seamlessly integrate ESG considerations into their investment strategies, optimizing ESG value creation post-deal. We assist financial and corporate investors, as well as asset owners and companies engaged in business sales or fundraising, in developing and implementing effective ESG-centric deal strategies.

KPMG’s ESG Deals & Value experts offer the following services:

• ESG investment framework development, including fund- and corporate-level ESG strategy and integration of ESG into valuation models and processes
• ESG deal/portfolio strategy development, including portfolio review and improvement, market assessment and deal sourcing, and ESG operational improvements
• ESG due diligence to ensure acquisitions are aligned to ESG strategy at the fund- and corporate-level
• ESG performance improvement of assets to enhance long-term financial performance and exit values

In a complex acquisition of a global chemical company’s carved-out business spanning Europe and Asia Pacific, our client sought a deep understanding of the financial, tax, commercial, and particularly ESG implications. Recognizing the necessity for localized expertise due to the target’s widespread operations, we formed a multidisciplinary team of specialists in finance, tax, commercial, and ESG due diligence from four KPMG member firms. This team executed a combined due diligence effort, with our ESG experts conducting on-site assessments and regulatory evaluations across multiple jurisdictions.

Our comprehensive due diligence process illuminated key financial, tax, commercial, and ESG risks, notably uncovering soil and groundwater contamination at certain locations. Beyond identifying these risks, our insights provided the client with a new perspective on ESG risks and opportunities. We highlighted significant impacts on operations, human capital, and staff pensions, advising on strategic post-deal integration measures to address these issues effectively.